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10/04/2021

Gap Acquires AI Startup CB4

Lisa Johnston
Senior Editor
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Gap sees AI and ML as shaping the future of the industry.
Gap sees AI and ML as shaping the future of the industry.

Gap Inc. is beefing up its artificial intelligence and machine learning ambitions with a new acquisition.

The apparel retailer has picked up Context-Based 4 Casting (CB4), a start-up providing AI and ML technologies for retail operations. The tech company seeks to drive sales and upgrade customer service through predictive analytics and demand sensing.

CB4’s technology has also been implemented by such retailers as Levi’s, Urban Outfitters, Lidl, and Kum & Go.

Sally Gilligan, Gap chief growth transformation officer, said the No. 35 retailer views artificial intelligence and machine learning as shaping the future of the industry.

“Gap Inc. has experience working with CB4’s world-class data scientists, so we understand the impact and the wide applications their science can have across sales, inventory and consumer insights,” she added, “as well as its potential to unlock value and enhance the customer experience.”

[See also: Gap Readies for Q4 With $100 Million Digital Fulfillment Investment]

Indeed, 38% of retailers in RIS News’ annual Retail Technology Study said they will start an AI upgrade within the next 12 months, while another 14% said they'll start one in the next 24 months.

When it comes to predictive and prescriptive analytics, 27% of retailers said they'll start an upgrade within the next 12 months, and 20% said within the next 24 months.

The deal was brokered by the retailer’s strategic growth office, an internal unit seeking out growth opportunities for Gap’s brand portfolio. The unit, which is led by Gilligan, made a similar deal earlier this year when it acquired 3D tech firm Drapr, a start-up enables customers to create 3D avatars and virtually try on clothing to help Gap tackle the returns challenges plaguing much of the retail industry.

It also participated in the most recent funding round for Obé fitness, a digital fitness platform partnering with Gap’s Athleta Brand. Gap seeks to grow brand loyalty and engagement through this partnership, as they team for content, events, and shopping experiences.

CB4’s team will join Gap as full-time employees.

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